This transcript has been automatically generated and may not be 100% accurate.

I ... welcome back to the very heart of successful investing conference on Kopin Tan With dance that is you ... and joining us when the conference for the first time it is still a priest ... bill is the CEO and co CIO of epoch Investment Partners ... home ... Hill started the firm in two thousand and four ... um now as of twenty four billion under management ... he's also the publisher of a book called the cash flow and showed real ... published in two thousandseven ... that warned us about the promise of the subprime market ... buildings are joining us thank you for having been what would you make a PC that the economy right now ... the pecan is a bit of a no win slam take ... you have three broad drivers ... of the US is ... probably the best house is a bad neighborhood ... we're going to eke out some growth ... Europe is in recession and probably going to continue ... Japan is struggling ... and emerging market outlook is ... to continue and grow but lower rate with the big news ... now that the minute you mention that there are three challenges to companies price to earnings multiples ... all about this ... well from the state when you get ... a new guide you in equity ... as an outsider to go by ... they're only three drivers of equity returns ... earnings dividends and peace Avici management has a lot to say about the words policy and earnings ... for the leverage control Rooke price earnings ratios ... and price earnings ratios are really driven by three elements ... interest rates ... fall to in the market itself ... and the growth rate inherent in Yukon ... it's so what's happening in the marketplace is there are three headwinds to PE expansion ... you already have low interest rates which are still issue I'm all ... but in reality if rates go up he's going to ... if the market turns out to be more volatile in the years ahead will experience that also will cause headwinds to ... and finally the growth rate going forward is going to be less ... of that that we've had passed just ahead ... one positive test quantitative easing steely is very helpful p ... S ... so we have slow growth as you said volatility and interest is more likely to call up over the long term because it can get a handle press release fifty ... we have some Q you said the weaker experience though quite some time ... yet super Ben Rene Kyi and this lasts a top basically said ... he will continue to have low interest rates ... until employment starts to rise ... along with that ... well it could take some time but recall that our Fed has to mandate what is to control inflation ... but secondly and more portly delisting to burn Anqi ... is that basically foster employment consistent with ... economic growth ... so the big step Low Rates foster growth which employs people ... he will continue that ... and until there is evidence of faster growth I think we're going with low rates for a long time ... let's talk a little bit about some specifics what you write in housing ... in after Bush is ... arguably one of the best managed companies in the entire world they are phenomenal Apple allocators ... they have something like forty one billion dollars ranks ... of is that this is ... beverage beer is avoid the police ... um ... they have free cash flow growth this can be throwing in the high single digits ... another dividend is only one nap percent of the pay down a lot of debt ... and dividends should be defined as the sum of cash share buybacks ... and debt pay downs for that is returning capital to show ... now to talk about investing in emerging markets ... through local champions ... of which the best ways for ... what you like best ... Nestle is ... the key look at the history is on the great companies in the world ... and the beauty of the school championships they have the ability to reconfigure their factors of production what does that mean well ... it's really land labor capital so they decided only chop and switch them anymore and is more cushion to make in Poland ... they can do that ... if they want to sell the chopper to China ... revenue or they can do that ... they have a lot of pieces they can move around ... to maximize the return on their capital which senses return on your Apple's show ... ok ... time for a good question I wanna ask you why don't you like ... banks were up for ... diversified management's ... well the problem with the ... diversified financials are banks is there's a complete lack of transparency ... it's perfectly possible to take a dollar and the revenue line ... and follow it down the bottom line ... Mr. Crucible we just don't buy companies that we can understand ... it's good